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Celebrating Financial Literacy Month with Your Children

April 29, 2024

Talking about money isn’t always easy, but it’s important to have these conversations with your kids and your family to help prepare them for the future. Consider incorporating age-appropriate financial topics and lessons into your routines to help your children start building healthy habits and refining their skills early on. 


What is financial literacy?

Financial literacy is the knowledge and, more importantly, the comprehension of financial skills and tools. It empowers people to create healthy, informed money habits and make smart financial decisions. Enhancing your financial literacy is always a great idea because your finances greatly impact the other facets of your life. With the right financial skills under your belt, you’re likely to budget more effectively, make and save more money, and become financially stable and independent. 

Why should I teach my young children about financial literacy?

Financial literacy is a foundational element of a healthy life. Financial worries and struggles naturally bleed into other parts of our lives, like work, school, and relationships. Starting early will help prepare your children with the tools and skills to effectively plan for their financial futures. Practice makes perfect and with enhanced financial skills, your kids can learn added responsibility, problem-solving, healthy spending and saving habits, confidence, goal-setting, and many more practical life skills.

Often, when kids graduate from high school or leave home, they aren’t prepared for real-world money decisions. Some of the most important financial lessons aren’t taught in schools, so it’s important to start at home. It’s never too early to start preparing for the future and your children will be thankful that you did!

Teaching Your Children About Financial Literacy

Financial literacy is a crucial skill for all of us to learn. Starting early, and starting slow is going to be the most effective way to incorporate healthy financial habits. You should also look to make the lessons interactive to enhance your child’s comprehension and retention. Think about games or activities that can help explain each concept, or look for fun videos that cover each topic. Foster an environment for open communication and asking questions, use real-world examples to drive your points home, and don’t forget to lead by example. Building their skills at home will help your children effectively manage their money and assets, avoid undue debt, and reach their financial goals in the future.

Talk About Money

For young children, one of the easiest first steps is just to start talking about money. You can begin by explaining what dollars and cents are. You can work on money math through interactive exercises like counting and rolling change. You should also begin introducing the idea that things we want tend to cost money. Additionally, you can consider starting a savings account to store your child’s gift and allowance money, or to house their college fund.

Ways to Earn Money

You can also start talking to your children about how to earn money. You might play pretend jobs or assign them chores to earn an allowance. As your children grow a bit older, introduce the idea of a lemonade stand or start a piggy bank to encourage saving for that new toy they want. You can also consider paying a portion for things they want like a trip to the mall with friends or a new device, teaching them to save up for their respective portion.

Ways to Save

With some of the background knowledge already in play, you can then begin discussing savings more in-depth with your children. Teach them about simple ways to save, comparison shopping, opportunity costs or trade-offs, and delayed gratification. Remember to explain the why—discuss emergency funds and saving for big ticket items like college, a dream vacation, or even a cell phone. Help them set financial goals and talk through how they will go about achieving them. For older kids, this might be a good time to open a savings account they can access and contribute to.


With the understanding of savings and opportunity costs in mind, your children are ready to learn about budgeting. Explain that in order to save up for the things we want, we might have to curb our spending for a period of time, or even make some permanent swaps. Help them break down their allowance or other funds into spending categories and walk them through the math to see how much they need to save to reach their goals and how this will affect their spending limits that month. When they ask for things in the store, remind them how it might play into their planned budget and their savings goals. This can also be a good time to consider opening a checking or spending account for older children.

Credit, Debt, and Interest

Once your kids reach middle or high school, it’s a good idea to start talking about credit, debt, and interest. Explain how interest works and how that affects saving and borrowing conditions in the financial market. Teach them about debt and smart borrowing habits, reminding them that it doesn’t have to be a bad thing and, sometimes, it’s necessary to achieve their goals. At the same time, consider discussing the importance of credit scores and our credit histories. You might think about getting your high schooler a credit card to practice some additional responsibility, or start talking to them about the student loans they’ll be needing soon. This can also be a good time to start talking about scams, identity theft, and account security, focusing on red flags to watch out for, negative impacts of falling victim, and how to respond.

The Final Say on Financial Literacy

Financial literacy is a crucial skill set, and it’s never too early to start learning. Most high schools don’t require in-depth financial courses, so starting at home and early is key. Building your child’s financial skills can help them throughout their life, developing their confidence, independence, and expanding upon other necessary life skills like accountability and problem-solving.

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